Where Is It Cheaper To Rent Than To Buy? 16 U.S. Cities Make The Cut.

San Francisco has the widest discrepancy between rent and PITI payments. (Credit: Getty Royalty Free)

California does it again. The high cost of home ownership is no secret in the West Coast cities, but the gap between monthly rent and monthly mortgage payments (includes principal, taxes, insurance and interest, or “PITI”) in those northern California cities is shocking in some cases. A recent study by the Urban Institute looked at the “rent gap”—or the additional portion of income that would go to cover the cost of a mortgage relative to the median rent—and found that there were sixteen cities where it will cost less per month to rent a home than to own one. (To come up with percentages that can be meaningfully compared to each other they used median income as the base level for comparison.) The cities at the top of the chart are where it is cheaper to own a home than to rent one. Click on the chart to expand.

So what does this chart mean? The numbers listed here are percentage points—so for the San Francisco example the difference between the percentage of salary a renter would spend versus a buyer is about 45 percentage points difference. The chart below shows percentages of income. Looking at San…

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A survey released this week by Ellie Mae, which polled more than 500 mortgage borrowers from three different generations, revealed that nearly a quarter of Baby Boomers reached out to a lender online.
Ellie Mae’s survey sought to better understand how borrowers use technology in the mortgage process.
Most of those surveyed recently obtained a purchase loan (53%), while others refinanced (44%) and the remaining (3%) took out a reverse mortgage.
The borrowers who were provided an online portal were twice as likely to say technology improved the loan process.
“Baby Boomers, like Millennials and Generation X borrowers, are looking for a digital mortgage experience.
Our Connecting with Borrowers Online survey showed that for Boomers, online portals made the biggest difference in a positive view of technology, with 79% stating that technology improved the loan process versus 49% for Millennials.” Tyrrell said additional data collected by Ellie Mae indicates that Boomers have a significant and growing online presence.
“The same survey also showed that for Boomers, many are looking for a simpler application, a faster process and more visibility into the process, highlighting the value of the digital mortgage to the Baby Boomer generation.” Leading reverse mortgage lender Finance of America Reverse said it’s ramping up its digital offerings to accommodate borrowers who prefer an online experience.
“We’re seeing this desire for more digital experiences from our own customers and you’ll see us reflecting this approach in both our website and our sales process over the coming months.” Sieffert said catering to reverse mortgage borrowers online is two-fold.
“When we think about what a digital experience should look like for our consumers, we want to make it easy for people who are ready to move forward with a reverse mortgage to get started immediately, while simultaneously providing an educational path for people who are not quite ready to transact,” she said.
“For an industry plagued by persistent distrust, refining digital channels and allowing customers to begin transactions on their own terms are important steps toward promoting more openness and transparency.”

TruVest, is a national real estate investment company that challenges the conventional investment community to think differently about atypical investments in green technology and real estate notes.
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